Median sales price falls for second month in a row. What happened last time that occurred?

The housing market in Bend, Oregon, tapered slightly in May, as the median sales price fell for the second month in succession and the inventory of homes on the market rose compared with April. Still, the year-to-date median price remained steady at a price that represents a high for the 10-plus years for which we have data.

May’s median sales price was $379,000. That’s 4.1 percent lower than March’s median sales price of $395,000 and 2.8 percent lower than April’s median of $389,950.

If recent history is any indication, this dip could eventually turn into a trampoline. The last time monthly median sales prices declined in consecutive months was in 2016 (when they fell for three months in a row, in fact). That stretch of monthly declines after the median price reached $374,000 in May ended emphatically with a 7.5 percent month-over-month increase from August to September to $385,750 – the calendar-year high for 2016.

Two hundred seventeen homes were sold in May, four fewer than in April. The number of houses whose priced was reduced was 107 — 32 percent. The last time the percentage of active listings with a reduced price was that high was in the three-month stretch in 2016 when the monthly median sales figure dropped. (See the previous paragraph for what happened after that three-month stretch.)

Year over year, May’s median sales price showed a 1.3 percent increase from the corresponding month in 2016. That is the smallest year-over-year increase in a monthly median sales figure since January 2016. That month, the median sales price of $317,450 was 3.7 percent lower than in January 2015.

The 2017 year-to-date median price stayed at $380,000 after taking into account May’s sales. That remains the highest year-to-date median price on record. In fact, each month of 2017 has reset or tied the record for the highest year-to-date median sales price.

High-end homes a big part of inventory

The inventory of homes rose to 3.1 months in May. Inventory — expressed as the time that would be required to sell all homes on the market given the current pace of activity — was 1.7 months in May 2016.

May 2017’s inventory is skewed, however, toward higher-priced homes. Of May’s 337 active listings, 33 percent were priced at more than $725,000 (that percentage was 25 percent in March and 31 percent in April). For homes priced from $225,100 to $625,000, the inventory is in the range of two months. And two months of inventory falls well on the side of being a “seller’s market.”

Tied to the inventory is the volume of homes on the market. Each month this year, the active listings have been the fewest for those respective months in the 10-plus years for which the Skjersaa Group has data. As mentioned in the previous paragraph, the quantity of homes priced at $725,000 and less is particularly tight.

Late spring and summer traditionally are the most active months for real estate, and if you’re looking to buy a home or considering putting yours on the market, I can be of help. In my time as a Realtor, I have helped clients achieve their desired results regardless of the time of year and the trend of the market. To learn more about how I can assist you in your real estate transaction, contact me at (541) 383-1426, or visit Bend Property Search to connect with me through my website.

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Scarcity of inventory drives increase in home prices

Anyone who has followed the Bend, Oregon, real estate market coming out of the great recession has probably wondered: How long can prices keep rising?

After all, mortgage interest rates have moved off their historic lows and appear headed for further increases. Higher interest rates cut into consumers’ buying power, and homes that are out of reach for potential home buyers won’t change hands.

But rather than facing a ceiling imposed by higher borrowing costs, home prices instead appear driven by the scarcity of inventory. And given that relationship, anyone waiting for an end to the upward trend to housing costs might have to be exceedingly patient — whether they’re in Bend or elsewhere in the United States.

Mortage News Daily, reporting on national home prices in the fourth quarter of 2016, noted a greater year-over-year increase in prices in December than in November and October. That means that even during a holiday season that traditionally heralds a slowdown in real estate activity, home prices rose more compared with a year prior than in more active months for home buying.

Here are the numbers: The Federal Housing Finance Agency reported a 6.2 percent increase in home prices in December 2016 compared with December 2015. The year-over-year gain was 6.1 percent in November 2016 and 6.0 percent in October.

The agency’s Housing Price Index is based on the purchase prices of homes whose mortgages are backed by or sold to Fannie Mae and Freddie Mac. Those two agencies own or guarantee about 60 percent of the total U.S. mortgage market.

“In the years since the financial collapse, [Fannie Mae and Freddie Mac] have been the major source of credit for most people who got mortgages, and the only source of credit for less-than-pristine borrowers,” The Washington Post noted.

Andrew Leventis, FHFA’s deputy chief economist, told Mortgage News Daily: “Although interest rates rose sharply during the fourth quarter, our data show no signs of a home price slowdown. Although it will certainly take more time for the full effects of the elevated interest rates to be felt, there is no evidence of a normalization in the unusually low inventories of homes available for sale, which has been the primary force behind the extraordinary price gains.”

From the fourth quarter of 2015 to the fourth quarter of 2016, the largest gains in home prices were in Oregon, at 11 percent. Colorado was second, at 10.6 percent, and Washington was fourth, at 10.2 percent.

Bend trailed the state’s average as a whole. The median sales price in December 2016 in Bend was up “only” 9 percent from December of the previous year. The inventory of homes for sale in December 2016, though, was 2.3 months — which, before the 2016 calendar year — would have matched the lowest inventory during the 10 years for which the Skjersaa Group has data.

As an article in The Bulletin newspaper noted, the median price of homes in Bend is still less than for cities that have a similar appeal. In Boulder, Colorado, the median price for the first six months of 2016 rose almost 15 percent from $790,000 in 2015 to $905,000 in 2016. In Jackson, Wyoming, the median sales price in 2016 was up 2 percent from the year before, to $875,000.

“What is interesting is that Oregon in general, and in Bend, there is still arguably a cheap option relative to some of its comparators,” Duy told The Bulletin, adding that he sees no reason for home prices to stop climbing.

In an environment such as Bend’s, having a Realtor who knows the market is vital for your interests. My experience and knowledge will help you get your best deal, whether you’re a buyer or looking to sell your current home. Please contact me at (541) 383-1426, or visit Bend Property Search to connect with me through my website.

 

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5 Tips for Setting an Asking Price That’s Right for the Current Real Estate Market

Happy couple holding for sale and sold signs kissing

Selling your home? Setting the right price is easy if you follow this strategy.

Learn How to Set the Right Asking Price Regardless Of Market Conditions

By Jason Boone

As a long time Bend Oregon Realtor one of the biggest problems I’ve seen occur over the years is sellers listing their homes too low.

The result of a low listing price is you will ultimately leave money on the table once your home is sold but you don’t want to overprice your home either because, you will end up pricing yourself right out of the Real Estate market.

What’s the solution to the problem?

How do you come up with the right price which will be perfect for home buyers in the Real Estate market so you can sell your home and walk away without feeling seller’s remorse because you might have left money on the table?

Tip 1 – It All Starts With Your Realtor

When you work with a Realtor we will do many things to help your home sell for the right price including doing a comparable analysis of other homes which have recently sold in the neighborhood so you know exactly what price you should list your home at.

Tip 2 – Trust Your Realtor’s Instincts

After your Realtor has presented you with the listing price for your home it’s important to trust your Realtor’s instincts because, you may end up going online to search for home prices in your neighborhood and see prices which are far different than what your Realtor wants to list your home for.

If this situation occurs it’s important to know that one of the reasons why you’re seeing different home prices online is because many times data which is reported online is not as accurate as the MLS data your realtor has access to.

Tip 3 – Understand What Influences Prices

Another important thing to know when you’re working with your Realtor is that one of the best things you can do as a seller is to take the time to really understand what influences home prices.

Even though you may think your home is exactly the same as another home for sale on the same block it’s actually different due to upgrades, unique features and renovations which the home may have had over the years.

Tip 4 – Start A Bidding War

Once you understand the basics behind pricing a home for sale you can start a bidding war for your home by staging your home to sell and making sure that your Bend Oregon Realtor is aware of all of the key selling points which your home has to offer.

Tip 5 – Remove the Emotional Attachment

Last of all, but most important, you can successfully price your home and sell it once you remove the emotional attachment which you have formed with your home over the years.

This is done by taking down family pictures, artwork and the many other personal marks you may have added to your home since you’ve lived there because once this is done your home will become a “product” which has to be sold rather than a part of your family you can’t bear to part with.


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To learn more tips for selling your home or to view homes for sale in the area contact me, Jason Boone, Principal Broker with Principal Broker at Duke Warner Realty | Skjersaa Group by calling me at (541) 383-1426 or by emailing me.

If you found this content valuable please like, share and leave me a comment on this post. 

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Jason Boone | Principal Broker, CRIS | Duke Warner Realty | Skjersaa Group
Oregon Real Estate Licensee | 1033 NW Newport Ave Bend, Oregon